1
Obstructed View:
New York State Aorney General
Eric T. Schneiderman
From the Office of:
What’s Blocking New Yorkers from Geng Tickets
SolD oUt AgAIn|
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Type the two words:
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This report was a collaborave eort prepared by the Bureau of Internet and Technology
and the Research Department, with special thanks to Assistant Aorneys General Jordan
Adler, Noah Stein, Aaron Chase, and Lydia Reynolds; Director of Special Projects Vanessa Ip;
Researcher John Ferrara; Director of Research and Analycs Lacey Keller; Bureau of Internet and
Technology Chief Kathleen McGee; Chief Economist Guy Ben-Ishai; Senior Enforcement Counsel
and Special Advisor Tim Wu; and Execuve Deputy Aorney General Karla G. Sanchez.
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TABLE OF CONTENTS
Execuve Summary ....................................................................... 3
The History of, and Policy Behind, New York’s Tickeng Laws ....... 7
Current Law ................................................................................... 9
Who’s Who in the Tickeng Industry ........................................... 10
Findings ....................................................................................... 11
A. The General Public Loses Out on Tickets to
Insiders and Brokers .................................................................... 11
1. The Majority of Tickets for Popular Concerts Are Not Reserved
For the General Public .......................................................................... 11
2. Brokers & Bots Buy Tickets in Bulk, Further Crowding Out Fans ...... 15
a. Ticket Bots Amass Hundreds or Thousands of Tickets in an Instant ....... 15
b. Even without Bots, Brokers Use Industry Knowledge and Relaonships
to Gain an Edge Over Fans ...................................................................... 21
c. Ticket Limits Are Not Regularly Enforced ................................................ 22
d. Brokers, With and Without Bots, Buy Up Many
Tickets to New York Events ..................................................................... 23
e. Brokers Sell Tickets at Substanal Markups ............................................ 25
f. Speculave Tickets Increase Confusion and Risk for Fans ........................ 26
g. The Market Structure Is Atypical ............................................................. 27
B. High Fees for Unclear Purposes Raise Concerns ......................... 28
1. Fees are Charged by Ticket Vendors and Venues ............................. 29
2. Event Ticket Fees are Higher than Most Online Vendors ................. 31
C. Restraints of Trade in Tickeng ................................................... 32
1. Seng of Ticket Resale Price Floors ................................................. 32
2. Pracces That Impede Consumer Access to
Alternave or “Unocial”Ticket Resale Plaorms................................ 33
Recommendaons ....................................................................... 34
Appendix – Methodology for NYAG Analyses ...............................38
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EXECUTIVE SUMMARY
The New York Aorney General (“NYAG”) regularly receives complaints from New Yorkers
frustrated by their inability to purchase ckets to concerts and other events that appear to sell
out within moments of the ckets’ release. These consumers wonder how the same ckets
can then appear moments later on StubHub or another cket resale site, available for resale at
substanal markups. In response to these complaints, NYAG has been invesgang the enre
industry and the process by which event ckets are distributed – from the moment a venue
is booked through the sale of ckets to the public. This Report outlines the ndings of our
invesgaon.
More than 15 years ago, NYAG issued a landmark report on what it called “New York’s largely
underground and unexamined cket distribuon system.” The report announced that it was
a system that provides “access to quality seang on the basis of bribes and corrupon at the
expense of fans.”
Since that report was wrien broad changes in the technology of ckeng and an overhaul of
New York’s ckeng laws have completely transformed the landscape, in ways both good and
bad. Following the repeal of New York’s “an-scalping laws” in 2007, the once underground
cket resale economy moved parally above ground. This change has produced some benets:
online marketplaces have replaced waing in long lines, the growth of cket resale plaorms
has somemes made it easier to sell unwanted ckets, and the last minute-minded can aend
shows without interacng with potenally dishonest street scalpers.
Yet many of the problems described in 1999
have persisted and, in some cases, have grown
worse. Whereas in many areas of the economy
the arrival of the Internet and online sales has
yielded lower prices and greater transparency,
event ckeng is the great excepon. The
complaints NYAG receives from consumers
concerning ckeng commonly cite “price
gouging,” “scalping,” “outrageous fees” and
“immediate sell-outs.” As one cizen wrote,
in a typical complaint: “The average fan has
no chance to buy ckets at face value … this
is a disgrace.” Many performers voice similar
frustraons.
1
The problem is not simply that demand for prime
seats exceeds supply, especially for the most in-
demand events. Tickeng, to put it bluntly, is a
xed game. Consider, for example, that on December 8, 2014, when ckets rst
went on sale for a tour by the rock band U2, a single broker purchased 1,012 ckets to one show
at Madison Square Garden in a single minute, despite the cket vendor’s claim of a “4 cket
1. See, e.g., Mark Savage, “Sir Elton John: Secondary ticket prices ‘disgraceful’,”BBC News (Dec. 16, 2015),
available at
http://www.
bbc.com/news/entertainment-arts-35091230; Patrick Doyle, “Eric Church on Scalpers, Bro-Country and Blake Shelton Scandal,”
Rolling Stone (June 11, 2014),
available at
http://www.rollingstone.com/music/news/eric-church-on-scalpers-bro-country-and-
blake-shelton-scandal-20140611.
“I think it’s extoronate
and I think it’s disgraceful.”
- Sir Elton John, referring to inated
secondary sales
“It’s a systemac problem
with music ...”
- Eric Church, referring to scalpers
4
limit.” By the end of that day, the same broker and one other had together amassed more than
15,000 ckets to U2’s shows across North America.
Consider that brokers somemes resell ckets at margins that are over 1,000% of face value.
Consider further that added fees on ckets regularly reach over 21% of the face price of ckets
and, in some extreme cases, are actually more than the price of the cket. Even those who
intend their events to be free, like Pope Francis, nd their good intent defeated by those who
resell ckets for hundreds or even thousands of dollars.
Findings
A. The General Public Loses Out on Tickets to Insiders and Brokers.
New Yorkers keep asking the same queson: why is it so hard to buy a cket at face value?
1. Holds & Pre-Sales Reduce the Number of Tickets Reserved for the General Public.
Our invesgaon found that the majority of ckets for the most popular concerts are not reserved
for the general public at least in the rst instance. Rather, before a member of the public can buy
a single cket for a major entertainment event, over half of the available ckets are either put on
“hold” and reserved for a variety of industry insiders including the venues, arsts or promoters,
or are reserved for “pre-sale” events and made available to non-public groups, such as those
who carry parcular credit cards.
2. Brokers Use Insider Knowledge and Oen Illegal Ticket Bots to Edge Out Fans.
When ckets are released, brokers buy up as many desirable ckets as possible and resell them
at a markup, oen earning individual brokerages millions of dollars per year. To ensure they get
the ckets in volume, many brokers illegally rely on special soware – known as Ticket Bots – to
purchase ckets at high speeds. As the New York Times reported, Ticketmaster has esmated
that “60 percent of the most desirable ckets for some shows” that are put up for sale are
purchased by Bots.
2
Our research conrms that at least tens of thousands of ckets per year are
being acquired using this illegal soware.
Brokers then mark up the price of those ckets – by an esmated 49% on average, but somemes
by more than 1,000% – yielding easy prots. In at least one circumstance, a cket was resold at
7,000% of face value. Finally, some brokers sell “speculave ckets,” meaning they sell ckets
that they do not have but expect to be able to purchase aer locking in a buyer. Speculave
ckets are a risk for consumers and also drive up prices even before ckets are released.
NYAG’s invesgaon idened those brokers re-selling the most ckets for New York events.
Nearly all were unlicensed, and several employed illegal Ticket Bots to buy ckets. A number of
specic invesgaons and enforcement acons are in process.
2. Ben Sisario, “Concert Industry Struggles With ‘Bots’ That Siphon O Tickets,” N.Y. Times (May 26, 2013),
available at
http://www.nytimes.com/2013/05/27/business/media/bots-that-siphon-o-tickets-frustrate-concert-promoters.html
5
B. High Fees for Unclear Purposes Raise Concerns.
Another common complaint concerns the unclear and unreasonable “service fees” added to the
face value of ckets, which are generally set by venue operators and cket vendors. New York
law prohibits these pares from adding fees to the prices of ckets unless they are connected
to the provision of a “special service” and are “reasonable.” Our examinaon of cket fees
set by 150 venues in New York raises concerns, revealing that unclear “convenience charges,”
“service fees,” and “processing fees” somemes reach outlandish levels, either as a percentage
of the cket’s face value or in absolute dollar terms. On average, New York venues and their
ckeng vendors charge fees averaging 21% of face values, which exceeds what other online
sellers charge. Moreover, we found fees as high as $42 aached to a cket to see Professional
Bull Riding at Madison Square Garden and $28 to see Janet Jackson at Jones Beach Theater.
C. Restraints of Trade Exist.
NYAG is concerned by the growing imposion of resale price oors (i.e. “no sales below list
price”), along with eorts to mandate that ckets be sold on a single “walled garden” market, as
opposed to consumers having the opon of buying ckets from dierent resale plaorms. We
are also interested in the degree to which excessive service charges may constute evidence of
abuse of monopoly power, especially as they relate to the resale of sports ckets.
Recommendaons
In 1999, NYAG found that, despite long-standing regulaon, the law “has not succeeded in
eliminang the abuse it was intended to address.” That remains true today, and New York
remains in need of greater protecons for the buying public. We therefore oer several
recommendaons:
A. Ticket Resale Plaorms Must Ensure Brokers Comply With the Law.
Ticket resale plaorms are in the best posion to ensure that their broker customers follow the
law, and they must take meaningful steps to do so. Specically, these plaorms should require
that brokers provide their New York license numbers as a condion of using the resale plaorm,
and disclose to potenal customers the face value of ckets they are oering for sale, as already
required by New York law.
B. Industry Players Must Increase Transparency Regarding
Ticket Allocaons and Limits.
The industry must provide greater transparency into the allocaon of ckets, to increase
accountability and enable the public to make informed choices. Promoters of events, who
know the number of seats being held, should provide that informaon to cket vendors, such
as Ticketmaster, to make available to the public. In addion, wherever cket vendors claim that
cket limits are enforced, they should enforce those limits as a maer of course on a per-person
basis. If such limits are not actually being enforced, cket vendors must make that clear.
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C. Ticket Vendors Must Address the Bot Epidemic.
Bot use is a major reason why New Yorkers cannot get ckets at face value. While the industry
works on long-term technological soluons to this problem, steps can be taken to reduce Bot
use in the near-term. NYAG has contacted Ticketmaster and another major cket vendor, AXS,
to discuss concrete reforms, such as preempve enforcement of cket limits, analyzing purchase
data to idenfy ongoing Bot operaons for prosecuon, and invesgang resellers of large
volumes of ckets to popular shows, among others.
D. The Legislature Should Act.
While there is no reason the industry should wait for legislave acon to implement the reforms
outlined above, the Legislature should act to ensure that reform is meaningful and lasng.
Specically:
i. Mandate the industry reforms outlined above.
ii. End the ban on non-transferrable paperless ckets.
A soluon that most industry parcipants agree is eecve at reducing broker acvity is
the use of non-transferrable “paperless ckets.” Unlike paper ckets and electronic ckets
that are freely transferrable from the buyer to another person, non-transferrable paperless
ckets require an event aendee to present the credit card that was used to purchase the
cket. As a result, the inial purchaser typically must be present to use the cket. State
law creates a
de facto
ban on these paperless ckets, but this rule makes New York an
outlier – ours is the only state that bans the pracce – and this ban should be repealed.
iii. Impose criminal penales for Bot use.
Given that cket resellers are making considered business decisions when they deploy
Bots to acquire massive amounts of ckets near-instantaneously, the prospect of criminal
prosecuon may well have a deterrent eect on this conduct.
iv. Cap permissible resale markups.
Unl 2007, New York capped the markup resellers could charge, and the State removed
that cap in hopes of beneng consumers. Unfortunately, compeon-driven savings
intended to benet fans have instead been converted to prots for a handful of savvy
middlemen using mulple employees or computers, or illegal Bots. New York should
reinstute a reasonable limit on resale markups.
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THE HISTORY OF, AND POLICY BEHIND,
NEW YORK’S TICKETING LAWS
New York’s approach to ckeng has undergone dramac changes over the last een years.
Understanding both the history and the policy goals of previous and current ckeng legislaon
is important to all that follows.
3
1920 – 2007: The “An-Scalping” Era.
“The greatest evil that theatergoers in this city have to contend with is the cket speculator,”
wrote a New York City magistrate in 1901. “They are praccally highwaymen and hold up
everybody that goes to a place of amusement.”
4
As the quote suggests, the resale of ckets for
prot has long been considered an aggravaon in this State. In 1922, Governor Nathan Miller
declared the need for acon to combat what he called “gross proteering” by “cket scalpers.”
He signed a law, widely described as an “an-scalping law,” that began the State’s regulaon of
cket sales for major events. It originally regulated “boxing and wrestling, relang to ckets to
places of entertainment,” and capped the price of resale ckets at two dollars above face value.
5
The law maintained its basic character for seventy years, broadening in scope, and adding various
provisions to ban bribes paid to venues by brokers for ckets (known as “ice”). Eventually, the
two-dollar limit became a 20% or 45% price cap (depending on the size of the venue), which
the law required to be printed legibly on each cket.
6
Over the years, the legislature periodically
imposed stricter penales on those selling ckets near venues and took steps to give the State
the power to police out-of-state actors dealing in ckets to events within New York.
Nonetheless, as NYAG’s report made clear in 1999, the law was both inconsistently enforced and
dicult to enforce. Underground brokers ourished, oen openly oung the law. By that year,
cket brokering had grown into a large underground economy typied by law-breaking, secret
cket holds, bribe paying, and a general state of corrupon at all levels.
2007 – Present: A Regulated Industry.
In 2007, in a sweeping legal change, the New York legislature decriminalized all resale of ckets
for prot, or “scalping,” and adopted an approach that sought to treat ckeng as a regulated
industry. With the price caps lied, brokers were now free to operate openly and sell ckets at
whatever prices consumers might pay. In the face of crics who warned that prices would rise
and brokers would reap unseemly prots, the sponsors of the Bill expressed some hope that the
new approach might, in fact, reduce cket prices on the resale markets. As Assemblyman Joseph
D. Morelle argued at the me, “By allowing greater compeon for the resale dollar, we may
actually see a decrease in secondary prices, which is … ulmately best for the consumer.”
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3. The governing statutory provisions are found in New York Arts and Cultural Aairs Law, Article 25 (“N.Y. Arts & Cult. A. L.”).
4. Kerry Segrave, Ticket Scalping: An American History, 1850-2005 (2006), p. 55.
5. N.Y. General Business Law §§ 167-69k (McKinney 1922) (repealed 1983).
6. The following notice was required to be printed on tickets:
“If the venue to which this ticket grants admission seats 6000 or fewer persons, this ticket may not be resold for more than 20%
above the price printed on the face of this ticket, whereas if the venue to which this ticket grants admission seats more than 6000
person, this ticket may not be resold for more than 45% above the price printed on the face of this ticket.”
7. Oce of Joseph D. Morelle, “Morelle Bill Establishing Free Market for Ticket Resellers Passes Assembly” (May 29, 2007),
available at
http://assembly.state.ny.us/mem/Joseph-D-Morelle/story/22938.
8
The operang premise of the 2007 law was not to completely deregulate cket resale, but
to legalize it pursuant to regulaon and taxaon. Pre-2007, many of the brokers operated in
open violaon of the law; the 2007 law introduced a revised licensing system supervised by
the Secretary of State. The licensing system required, among other things, various disclosures
of ckets sold, the posng of a bond to cover counterfeit ckets, and the payment of a $5,000
annual fee.
Above all, the 2007 law represented
a new and experimental approach
to the cket industry, made clear by
the fact that the law regularly sunsets
and is therefore subject to ongoing
nkering by the legislature. The rst
adjustments came in 2010, when the
law underwent major changes, three
of which are important here. First,
for the rst me, the law banned
the use of cket-buying soware,
or “Bots.” The New York Senate
commentated that such soware is
“used by unscrupulous speculators to
purchase ckets at inial sale ahead
of consumers intending to aend an
event,” and put enforcement dues
in the hands of the Aorney General.
8
Evident in the ban on Bots and the
legislature’s commentary is the idea that cket buying, when presented to the public as a fair
contest, should in fact be fair, and not subject to manipulaon by soware or similar techniques.
In other words, the legislature prefers that the ability to obtain ckets be based on factors like
showing up at the right me or simple luck of the draw, as opposed to gaining an advantage
through soware that funcons dierently than a human could.
Second, an important 2010 legal reform addressed growing service fees imposed by primary
cket sellers and their cket vendor agents, such as Ticketmaster or Telecharge. It mandated, for
the rst me, that any fees charged for “special services” must be “reasonable.”
9
Third, the law
barred non-transferrable paperless ckets, as discussed in greater detail later in this Report.
10
The clear tenor of the ckeng statute is to make cket brokering into a regulated industry and
connue “safeguarding the public against fraud, extoron, and similar abuses.” Ticket brokers
are not illegal, but must obtain a license, post bonds, disclose their acvies to the Secretary of
State, and avoid using prohibited Bots. Whether the new system has operated in the interests
of New York cizens remains an open queson of public policy.
8. New York State Senate Introducer’s Mem., SB No. 3840-A.
9. N.Y. Arts & Cult. A. L. § 25.29 (as amended July 2, 2010).
10. Id. § 25.30.
What’s a Bot?
A Ticket Bot is soware that automates
cket-buying on plaorms such as
cketmaster.com.
Automaon lets the Bot (1) perform
each transacon at lightning speed, and
(2) perform hundreds or thousands of
transacons simultaneously.
As a result, in the rst moments aer
ckets to a top show go on sale, Bots
crowd out human purchasers and can
snap up most of the good seats.
9
CURRENT LAW
New York State law prohibits engaging “in the business of reselling any ckets to a place of
entertainment” within New York State without rst procuring “a license.
11
Those who resell, oer
to resell, or purchase with the intent to resell ve or more ckets without a license are guilty
of a misdemeanor and subject to penales.
12
Addionally, the law requires that brokers post
a $25,000 bond with their license applicaon to ensure compliance with the law’s provisions
and cover damages to their customers from any misconduct.
13
Brokers that resell ckets online
must also display a hyperlink to a copy of their licenses,
14
and they must display the face value of
ckets along with the resale prices.
15
New York State law also makes it illegal for brokers to use Bots to bypass security measures on
the websites of cket vendors, such as Ticketmaster, or to maintain any interest in or control of
such Bots.
16
Anyone who violates these provisions is subject to penales and the forfeiture of
prots.
17
No current federal law specically prohibits the use of Ticket Bots, but legislaon has been
proposed that would do so. The Beer On-line Ticket Sales Act of 2014 or the BOTS Act, supported
by Senator Charles Schumer, would prohibit, as an unfair and decepve act, the sale or use of
Ticket Bots. It would also provide for criminal penales for those who engage in this conduct.
11. Id. § 25.13.
12. Id. §§ 25.09(2), 25.35.
13. Id. § 25.15.
14. Id. § 25.19.
15. Id. § 25.23.
16. Id. § 25.24.
17. Id.
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WHO’S WHO IN THE TICKET INDUSTRY
11
FINDINGS
A. The General Public Loses Out on Tickets to Insiders and
Brokers.
The majority of ckets for popular concerts are diverted away from the general public. First,
various “hold” and “pre-sale” programs reduce the total number of ckets available to the
general public. Then, of those ckets that remain, brokers use a number of methods including
Bots to seize a large poron of the remaining ckets. Brokers even sell ckets that they do not
actually own, known as “speculave” ckets, to fund their later purchases.
1. The Majority of Tickets for Popular Concerts Are Not Reserved
For the General Public.
It may come as no surprise to fans that many concert ckets are never made available to the
general public, but there is lile informaon available as to where precisely those ckets actually
go. To bring some light to this issue, NYAG has obtained and analyzed informaon regarding the
allocaon and distribuon of ckets from the largest promoters, Live Naon and AEG, for the
top-grossing shows in New York for the years 2012-2015.
NYAG found that, on average, only about 46% of ckets are reserved for the public. The remaining
54% of ckets are divided among two groups: holds (16%) and pre-sales (38%).
18
Holds are ckets
that are reserved for industry insiders, such as arsts, agents, venues, promoters, markeng
departments, record labels, and sponsors. Pre-sales make ckets available to non-public groups
before they go on sale to the general public. The two most common pre-sale events are for
credit card holders and members of fan clubs, but venues, promoters, or other groups may run
pre-sale events as well. Brokers, as discussed below, oen begin harvesng ckets at these pre-
sale events and later during the general on-sale.
18. The methodology for this analysis is in the Appendix.
12
Figure 1. Less Than Half of Tickets Are Reserved for the General Public.
Source: Live Naon/Ticketmaster (2012 – 2013) and AEG (2012 – 2015)
19
Among the top grossing shows in New York, approximately 16% of all ckets were reserved
through “holds” for industry insiders: arsts, venues, agents, markeng departments, sponsors,
promoters, and execuves.
20
Oen, venues are the biggest beneciaries of these holds. For
example, Madison Square Garden was typically allocated more than 900 ckets per concert
and Barclays Center was allocated an average of 500 ckets per concert for the highest grossing
concerts held at those venues.
For some concerts, cket holds account for well over 16% of the available ckets. For instance, a
Kanye West show at Barclays Center held 29% of ckets for insiders, including over 2,000 ckets
for the promoter and more than 500 ckets for the venue. In all, fourteen of the State’s most
popular shows held at least 20% of available ckets for insiders, as shown in Figure 2. Holding
a large number of ckets is not necessarily a pracce among all shows – the Vans Warped Tour
2013 and Barry Manilow concerts, both at the Nassau Coliseum, held 5% or less of ckets.
19. The methodology for this analysis is in the Appendix.
20. It is worth noting that a hold simply represents a reservation, and that in most cases a group that has been allocated tickets
through a hold will not use a portion of those tickets. In these instances, the tickets are released back to the promoter, who will
typically make the tickets available for sale to the public. Because the tickets are usually not released through a publicized on-sale
event, tickets released in this manner are often purchased by brokers who are constantly searching for new tickets that are made
available closer to the date of the event.
Ticket Allocaon
Holds for Insiders
Pre-Sale Events
General Public
13
Figure 2. Fourteen Popular Shows Held at Least 20% of Tickets for Insiders.
Source: Live Naon/Ticketmaster (2012 – 2013) and AEG (2012 – 2015)
21
Filtered for shows with 20% or more total capacity placed on hold
Approximately 38% of ckets to the most popular shows in New York were reserved for “pre-
sales,” advance sales to select groups of fans and cardholders of major banks and nancial
instuons.
22
These nancial instuons, including American Express, Cibank, and Chase, have
negoated agreements whereby their cardholders have the opportunity to purchase ckets
21. The methodology for this analysis is in the Appendix.
22. For the top shows, it is often the case that all of the tickets that are made available through the pre-sale events are sold. For
less popular shows, tickets set aside for pre-sale events can go unsold. When tickets set aside for a pre-sale event are not sold, the
unsold tickets are reallocated to the initial public on-sale.
Trey Songz
Madison Square Garden
(Theater) on 3/1/2012
20%
Jusn Bieber
Madison Square Garden on
11/29/2012
28%
Jusn Bieber
Madison Square Garden on
11/28/2012
28%
Keith Urban
Madison Square Garden on
1/29/2014
20%
The Voice
Beacon Th eatre on 7/9/2014
22%
Ricardo Arjona
Madison Square Garden on
2/26/2012
23%
Fresh Beat Band
Madison Square Garden
(Theater) on 11/30/2013
24%
Fresh Beat Band
Madison Square Garden
(Theater) on 11/29/2013
24%
Kanye West
Barclays Center on
11/20/2013
21%
Kanye West
Barclays Center on 11/19/2013
29%
Drake
Jones Beach on 6/16/2012
20%
Luke Bryan
Nassau Coliseum on
2/7/2013
20%
Farm Aid
Saratoga Perf orming Arts
Center (SPAC) on 9/21/2013
22%
Fleetwood Mac
Madison Square Garden on
4/8/2013
24%
NKOTB
Nassau Coliseum on 6/1/2013
24%
Promoter
LiveNao n
AEG
14
before the ckets are released for sale to the general public. Importantly, fans are not necessarily
the ones purchasing ckets released in pre-sale events. For popular events, brokers, realizing the
advantages of pre-sale programs, purchase heavily and oen use illegal Bots to maximize their
yield in pre-sales, as discussed in greater detail below.
23
While the majority of pre-sale events
are conducted by credit card companies, members of other groups, including fan clubs, social
media websites, and specialty shopping sites also receive advance opportunies to purchase
ckets.
The number of ckets reserved for pre-sale events can be quite large for some concerts. For
example, for more than 30 of New York’s most popular concerts, at least half of the ckets were
set aside for pre-sale events. Figure 3 idenes ten shows that made more than half of the
ckets available through pre-sale events where none of the ckets were explicitly reserved for
fan clubs.
Figure 3. Ten Popular Shows Reserved Over 50% of Tickets
Through Pre-Sales Events, None Explicitly Earmarked for Fan Clubs.
Source: Live Naon/Ticketmaster (2012 – 2013)
24
Filtered for shows with more than 50% of total capacity sold through
pre-sale events and no ckets specically earmarked for fan clubs
23. Even setting aside the problem of brokers, cardholder pre-sales may disadvantage many fans. They reserve tickets for hold-
ers of select credit cards, who may generally be wealthier than fans who lack those cards and the benets that come with being
a cardholder. As a result, these pre-sales give wealthier fans a better chance of getting tickets at face value, while decreasing the
supply of face-value tickets available to less wealthy fans.
24. The methodology for this analysis is in the Appendix.
Fleetwood Mac
Madison Square Garden on 4/8/2013
61%
Coldplay & Jay-Z
Barclays Center on 12/31/2012
70%
Coldplay &
Jay-Z
Barclays Center on 12/30/2012
52%
Jay-Z & Jusn
Timberlake
Yankee Stadium on 7/20/2013
69%
Jay-Z & Jusn
Timberlake
Yankee Stadium on 7/19/2013
71%
SteelyDan
Beacon Theatre on 10/8/2013
64%
SteelyDan
Beacon Theatre on 10/5/2013
65%
SteelyDan
Beacon Theatre on 10/4/2013
64%
SteelyDan
Beacon Theatre on 10/1/2013
64%
SteelyDan
Beacon Theatre on 9/30/2013
64%
Promoter
LiveNao n
15
Holds and pre-sales can leave few ckets for the public. Indeed, for many of the top shows, less
than 25% of ckets were actually released to the general public in an inial public on-sale. For
example, just over 1,600 ckets (12% of all ckets) were released to the public during the inial
public on-sale for a July 24, 2014 Katy Perry concert at Barclays Center. Similarly, for two Jusn
Bieber concerts at Madison Square Garden, on November 28, 2012 and November 29, 2012,
fewer than 2,000 ckets (15% of all ckets) to each show were released to the public during the
inial public on-sale.
2. Brokers & Bots Buy Tickets in Bulk, Further Crowding Out Fans.
The broker industry, while not the explicitly underground industry it was in the 20th century,
remains dicult to learn about and oen operates in violaon of one or more State laws.
The average fan vying to purchase a cket to a popular concert has lile hope of compeng
against brokers, many of whom use illegal and unfair means to purchase ckets. Brokers are
able to purchase large quanes of ckets to popular events by (a) employing illegal Bots, and/
or (b) exploing their industry knowledge and relaonships to get access to ckets.
a. Ticket Bots Amass
Hundreds or Thousands
of Tickets in an Instant.
A Ticket Bot is a soware
program that automates
the process of searching
for and buying ckets to
events on cket vendor
plaorms, such as
Ticketmaster. Using Bots,
a broker can automate the
process of searching for
and buying ckets so that it occurs in the blink of an eye, and conduct tens, hundreds, or even
thousands of lightning-fast transacons at the same me.
To successfully buy thousands of ckets, Bots must perform four dierent funcons. These
funcons may be handled by one Bot or several.
First, spinner, or “drop checker,” Bots constantly monitor ckeng sites to detect the release, or
“drop,” of ckets. Ticketmaster has stated that spinners can account for as much as 90% of the
trac to its website.
25
Second, Bots automate the search for and reservaon of ckets that are up for sale. Here,
brokers exploit the fact that most ckeng plaorms “reserve” ckets for a few minutes to give
the (human) customer me to complete the purchase. Brokers take advantage of this feature
by conducng mulple near-instantaneous searches at the precise moment ckets are released
for sale, throwing hundreds of ckets into reserve and removing them from the pool of ckets
25. Ticketmaster L.L.C. v. RMG Technologies, Inc., 07-Civ.-2534 (C.D. Cal.) (Application for Entry of Default Judgment); Ben Sisario &
Emily B. Hager et al., “Fair Ticketing: Fans Before Scalpers,” N.Y. Times Video (May 27, 2013),
available at
http://nyti.ms/13V6sdO.
“...According to Ticketmaster, bots have been used to
buy more than 60 percent of the most desirable tickets
for some shows….”
Concert Industry Struggles With ‘Bots’ That
Siphon Off Tickets
16
available for purchase. The broker may then review the search results and choose which seats
to buy.
26
Figure 4 shows an example of a Bot that has searched for and reserved several groups
of ckets, displaying the groups and the me remaining for the Bot-user to purchase each one.
Figure 4. Bot Displays Time Remaining to Buy
Temporarily “Reserved” Tickets.
Source: Ticketbots.net
Third, Bots automate the process of purchasing ckets, using dozens or hundreds of purchaser
names, addresses, and credit card numbers. The names of the “buyers” may be simply invented,
or they may be borrowed from real people.
Fourth, and nally, Bots must defeat the an-Bot security measures that most cket-selling
plaorms employ. The most obvious of the cket vendors’ defensive tools that Bots must bypass
is the “CAPTCHA” test (“Completely Automated Public Turing test to tell Computers and Humans
Apart”). This test usually requires that a user prove she is human by reviewing text that is
distorted or obscured and entering those characters into a text box.
26. Some brokers use this interval to oer the temporarily reserved tickets for sale on secondary market platforms such as Stub-
Hub at a given markup, and only if the resale is quickly consummated do they then actually buy the reserved tickets from the
primary ticket vendor. This ability to use temporary reserve to avoid risk greatly undermines a shibboleth repeated to NYAG
during our investigation, that brokers benet the ticket industry as a whole, including artists, promoters, and venues, by taking on
nancial risk through up-front purchases of lots of tickets which they may be unable to resell.
17
Figure 5. Ticket Vendors Use Dierent Types of CAPTCHA.
Unfortunately, many Bot programmers have been able to bypass these forms of CAPTCHA.
Over the years, Ticketmaster has repeatedly refurbished its CAPTCHA program, using dierent
versions of CAPTCHA created by third pares such as Google and Solve Media.
27
While these
CAPTCHAs may have stopped some Bots, more sophiscated Bot programmers quickly adapted.
In many cases, they collected thousands of the new CAPTCHAs and used them to “train” their
soware to “read” the new CAPTCHAs through improved opcal character recognion. In other
instances, the Bots transmit in real-me images of the CAPTCHAs they encounter on Ticketmaster
and other sites to armies of “typers,” human workers in foreign countries where labor is less
expensive. These typers – employed by companies such as Death by CAPTCHA, Image Typerz,
and DeCaptcher – read the CAPTCHAs in real-me and type the security phrases into a text box
for the Bot to use to bypass cket vendors’ defenses and use their sites.
28
Addionally, at various points, Ticketmaster abandoned CAPTCHAs for its mobile app on the
iPhone plaorm, based on the premise that it could beer verify idenes on mobile and
therefore did not need a CAPTCHA test. Our invesgaon of brokers reveals that some have
targeted the CAPTCHA-free mobile plaorm by either designing Bots to mimic mobile devices
or by using an arsenal of actual mobile devices to buy ckets.
27. Some CAPTCHAs incorporate technology that attempts to identify Bots before an image is even shown, to present an easier
test to likely humans and more dicult CAPTCHAs to suspected Bots. See, e.g., Solve Media – High Security Standards, http://
solvemedia.com/security/index.html. Many sophisticated Bot developers have bypassed these additional measures.
28. Some CAPTCHAs now do away with security phrases and use other types of puzzles. See, e.g., Google – “Introducing No CAPT-
CHA reCAPTCHA,” https://googleonlinesecurity.blogspot.com/2014/12/are-you-robot-introducing-no-captcha.html. It remains to
be seen if these new approaches will be harder to bypass, especially for Bots that use teams of human typers.
18
To eecvely beat out the many fans (and other Bots) aempng to search for and reserve ckets
at the start of a sale, most Bots simultaneously aempt mulple connecons to the cket vendors’
systems, oen dozens or even hundreds at a me. These connecons are oen responsible for
sudden massive increases in Internet requests to ckeng websites when ckets are released.
To conceal that these large numbers of concurrent connecons originate from a single source,
most Bot users purchase hundreds or thousands of proxy IP addresses to use for each separate
connecon aempt. Moreover, because cket vendors block or slow trac connecons from IP
addresses that appear to be used by Bots, many Bots automacally rotate through their stores of
proxy IP addresses to bypass detecon and blocking. Bot users also typically register hundreds
or thousands of e-mail addresses, again to conceal that a single purchaser is responsible for
many concurrent transacons and to circumvent security measures designed to prevent Bots
from purchasing ckets.
With these capabilies, Bots can be extremely eecve for brokers. First, they can buy hundreds
of ckets in moments. NYAG has idened many instances in which Bots were able to purchase
hundreds of ckets within moments of the release of ckets to the general public or through a
pre-sale, including the examples shown in Figure 6.
Figure 6. Bots Buy Huge Numbers of Tickets Moments Aer Release.
Source: NYAG Invesgave Materials
1,012
tickets in
1 minute
U2 2015 Tour
Madison Square Garden
Bought by one bot on December 8, 2014, for a
July 19, 2015 concert.
520
tickets in
3 minutes
Beyoncé
Barclays Center
Bought by one Bot on March 4, 2013 for an
August 5, 2013 concert.
15,087 tickets in 1 day
U2 2015 Tour
Twenty Different Venues
Bought by two Bots on December 8, 2014 for
twenty concerts in the same tour across North
America.
522
tickets in
5 minutes
One Direction
Jones Beach
Bought by one Bot on April 14, 2012 for a June
28, 2013 concert.
19
Addionally, by being rst in line, Bots can also purchase the most desirable seats to many shows.
For example, NYAG reviewed a case study by one cket vendor showing that Bots purchased
more than 90% of the most desirable ckets to one show. As part of its own analysis, NYAG
found that, of the 251 ckets one Bot operaon purchased to a May 5, 2014 Coldplay concert
at the Beacon Theatre, 148 of those ckets were in the rst seven rows of the theater. This
amounted to more than 60% of seats in those seven rows.
As a result of these huge advantages, Bots are able to purchase many ckets to New York events.
The sources we interviewed uniformly stated that the usage of Bots has reached epidemic
proporons in the ckeng industry. Indeed, NYAG found that three brokers using Ticket Bots
collecvely purchased more than 140,000 ckets to events in New York over a three-year period
between 2012 and 2014.
Broker Profile: The One-Man Bot Broker
Revenue: $1.4 million from events in New York (2014)
Method: Bot mimicking Ticketmaster app & 1,000+ credit cards
Broker A was an illegal Bot user who represents a typical species of broker. The
company is a one-man operaon that opened when its proprietor was sll in
college. The company paid overseas programmers for sophiscated cket-buying
Bots designed to mimic the Ticketmaster iPhone app and defeat its an-Bot
defenses. To maximize its yield, and avoid cket limits, the company obtained more
than 1,000 credit cards, many of which used ficous names, each designed to
appear to Ticketmaster as a different individual.
Armed with its Bot and collecon of credit cards, the company directed legions of
purchase requests at popular shows; its acons are part of what led to the quick
sellouts. Its harvest was put up for resale on numerous plaorms, including Stub-
Hub and Vivid Seats, and its own site. While it made much of its money from New
York venues, the company is not licensed in New York.
20
21
b. Even without Bots, Brokers Use Industry Knowledge and
Relaonships to Gain an Edge Over Fans.
Brokers who do not use Bots nevertheless have several signicant advantages over the average
fan based on their knowledge of the industry and relaonships.
First, brokers in many instances take advantage of pre-sale events oered to holders of certain
credit cards. Brokers are aware of which credit cards can be used in pre-sales and open accounts
for these credit cards. Brokers also closely follow cket release schedules and are prepared to
purchase ckets at pre-sales, when the compeon for ckets is oen less than during a public
on-sale.
In many instances, arsts try to get ckets into the hands of fans by oering pre-sales to ocial
fan clubs, for example by issuing special codes to fan clubs that allow members to log into the
pre-sale on cket vendor sites ahead of the general on-sale. Unfortunately, brokers oen sign
up for these fan clubs, obtain the codes, and either use them themselves or sell them to other
brokers.
Second, Brokers have resources to aempt many concurrent connecons. Brokers understand
that it is important to try to reserve and purchase as many ckets as possible during the rst
moments of an on-sale. Many brokers therefore use mulple computers or mobile devices to
try to connect to ckeng websites at the same me. NYAG spoke with one broker who owned
100 mobile devices and claimed to use dozens of those at a me by himself to try to purchase
ckets. Some brokers employ dozens of people simply to have many humans trying to reserve
and purchase ckets at the same me.
Third, many Brokers maintain direct relaonships with venues and sports teams. In these cases,
brokers are able to purchase ckets without compeng for ckets through the ckeng website.
Barclays Center, for example, has provided several brokers who own season ckets to Brooklyn
Nets games with the opon to purchase several hundred ckets to most other events at the
venue, including all music concerts. More than 500 ckets to an Elton John concert at Barclays
Center were distributed to brokers in this manner.
22
c. Ticket Limits Are Not Regularly Enforced.
The consumer may be familiar with the cket limits that are encountered on the websites of
most cket vendors. Popular arsts and their promoters typically seek to have vendors, like
Ticketmaster or AXS, impose a limit on the number of ckets that any individual can purchase
for any event. For concerts, a typical limit is eight ckets per purchase; more popular concerts
set smaller limits. The theory behind limits is intuive and obvious: by liming the number of
ckets any one individual can purchase, ckets will be more fairly distributed. If cket limits
were truly eecve – if it were impossible for any one person to buy more than the stated
number of ckets – broker acvity would be greatly limited.
Our invesgaon suggests that in the case of some cket vendors, including Ticketmaster, cket
limits do not always have the eect the public would expect. Ticketmaster implements cket
limits by restricng the number of ckets that can be purchased in a single transacon (a per-
transacon limit). It does not, however, restrict at the me of sale the number of ckets that can
be purchased by a user through mulple transacons (a per-person limit). In other words, when
an arst requests an eight-cket limit, Ticketmaster will permit a user to purchase only eight
ckets in a single transacon, but then will allow the same user to make addional purchases of
eight ckets each.
Broker Profile: Licensed Broker
Revenue: $25.4 million (2013)
Method: Employees buy ckets en masse
Broker C is a licensed �cket broker. In opera�on since the 1990s, the company has
become highly profitable under the new �ckets law. The company employs approxi-
mately 25 full-�me employees; each employee is paid a wage to keep his or her
own accounts and purchase, using his or her own American Express credit cards, as
many �ckets as possible for shows or events decided upon by management. The
company pays its annual licensing fees to the New York Secretary of State.
Broker C is an example of the 2007 law in opera�on. On the one hand, the
company pays its licensing fees, discloses its ac�vi�es, and is in apparent compli-
ance with most of the regula�ons. On the other hand, the company’s sizable annual
profits – $4.8 million in gross profit in 2013 – are direct evidence of the prices that
the public pays on the secondary �cket markets.
23
Ticketmaster can aempt to idenfy violaons of the cket limit aer ckets have been sold
by canceling those transacons that exceeded the limit the arst had requested. It will only
undertake this review, however, if an arst specically requests the audit. Yet many arsts seem
unaware of this fact. For example, a sophiscated representave of several top arsts playing the
largest arenas told NYAG they had been unaware that Ticketmaster required a separate auding
request to enforce limits the arst had already requested, and had therefore never made such
a request. Thus, although some arsts are trying to make ckets available to average fans by
pricing them below market value and seng cket limits, the lack of real-me enforcement per
user at the point of purchase (or thereaer) undermines their eorts.
The main beneciary of the unenforced cket limits is, of course, the broker industry. As repeat
players, the brokers know well that the limits are rarely enforced. Our interviews with brokers
and others in the industry, and our review of cket purchasing data, reveal that the limits,
enforced or not, are easy to evade. The eect of these shortcomings in enforcement of cket
limits is exacerbated where brokers use Bots to speed up their purchases above the limits, to
the detriment of ordinary members of the public. As a result, brokers have an advantage as
compared to ordinary buyers, who believe the phrase “cket limits” means what it says.
d. Brokers, With and Without Bots, Buy Up Many Tickets to New York Events.
Evidence that brokers are responsible for the purchase of large quanes of ckets can somemes
be seen in sales data that tracks the purchasing acvies of enes holding mulple credit cards.
For example, Figure 6 below shows American Express cardholders who purchased more than
$3 million in ckets through Ticketmaster for events in New York State and surrounding areas
using their American Express cards. A single broker used 149 dierent American Express cards
to make more than 38,000 purchases totaling over $12 million just from 2013-2015, while other
brokers racked up similarly shocking volumes of purchases, somemes using just a handful of
credit cards.
24
Figure 7. Twelve Brokers Each Purchased More than $3 Million in Tickets.
Source: American Express Purchases to Ticketmaster for Events
in New York & Surrounding Areas (2013-2015)
29
29. The methodology for this analysis is in the Appendix.
$12,251,282
throug h
38,366
transactions an d
149
cards .
$11,668,951
throug h
45,711
transactions an d
87
cards
.
$6,175,235
throug h
16,805
transactions an d
644
cards
.
$3,838,637
throug h
13,678
transactions an d
170
cards
.
$3,129,622
throug h
12,450
transactions an d
132
cards
.
$5,595,105
throug h
26,656
transactions an d
25
cards
.
$4,625,014
throug h
11,680
transactions an d
54
cards
.
$3,697,400
throug h
11,046
transactions an d
20
cards .
$3,592,798
throug h
10,039
transactions an d
23
cards .
$3,309,475
throug h
7,992
transactions an d
289
cards
.
$3,361,108
throug h
18,776
transactions an d
4
cards
.
$3,280,623
throug h
8,061
transactions an d
57
cards
.
25
e. Brokers Sell Tickets at Substanal Markups.
Brokers prot by selling ckets at a substanal markup over face value. NYAG studied six cket
brokers and found they marked up their ckets an esmated 49% on average, ranging by broker
from an average of 15% to 118%. Figure 8 depicts the markups charged by representave brokers
for their most protable shows.
Figure 8. Examples of Six Brokers’ Markups Show Large Prots.
Source: Transaconal sales data for select brokers (2011-2014)
30
30. The methodology for this analysis is in the Appendix.
$1,600
$815
$1,600
$350
$218
$218
$544
$443
$544
$250
$570
$693
$64
$101
$1,602
$79
$4,400
$3,650
$3,526
$1,249
$932
$925
$1,590
$1,155
$1,008
$1,306
$1,221
$999
$1,404
$1,351
$1,256
$7,244
$5,336
$4,635
$0 $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 $7,000 $8,000
Barbra Streisand @ Barclays Center
NY Rangers v. LA Kings @ Madison Square Garden
Barbra Streisand @ Barclays Center
U2 @ Madison Square Garden
Stanley Cup Finals @ Madison Square Garden
Stanley Cup Finals @ Madison Square Garden
Eric Clapton @ Madison Square Garden
NHL Conf. Finals @ Madison Square Garden
Eric Clapton @ Madison Square Garden
Yusuf Islam/Cat Stevens @ Beacon Theatre
NHL Conf. Finals @ Madison Square Garden
NHL Conf. Finals @ Madison Square Garden
Ed Sheeran @ Madison Square Garden
Eagles @ Madison Square Garden
Pearl Jam @ Barclays Center
One Direction @ Madison Square Garden
Barbra Streisand @ Barclays Center
One Direction @ Beacon Theatre
Ticket Face Value Markup Amount
Custom Bot
Broker A
Custom Bot
Broker B
Bot Broker B
Non-Bot
Broker B
Non-Bot
Broker A
Bot Broker A
$94
$228
26
Figure 9. Brokers Charge Large Markups.
31
Source: Source: Transaconal sales data for select brokers (2011-2014)
Our analysis also reveals that the brokers that commanded the greatest markups in the cket resale
market were those that used Ticket Bots, and, moreover, that the most sophiscated, custom
Ticket Bots were associated with the highest markups. This may be because the sophiscated,
custom Bots were able to purchase the most desirable seats, which could be resold for the
highest prices.
f. Speculave Tickets Increase Confusion and Risk for Fans.
In early December 2015, ckets purporng to be for Bruce Springsteen’s 2016 “River Tour”
began appearing on secondary sites like StubHub, TicketNetwork and Vivid Seats. Some ckets
were even adversed for inated prices of as much as $5,800 per cket. The catch? No such
ckets had yet been released. What brokers were selling were “speculave ckets,” that is to
say, ckets that they planned, or hoped, to buy later.
When a speculave cket is sold, the broker then tries to purchase an actual cket, at a lower
price, to provide to the buyer. The broker pockets the dierence between the price at which he
pre-sold the cket and the price at which he later bought the cket. Speculave ckets harm
both consumers and the cket industry. In many cases, consumers are just defrauded – they
do not receive the specic seats they paid for, instead receiving ckets for some other seats.
In some cases, consumers receive no ckets at all. Speculave cket sales also drive up prices
for consumers and oen cause widespread confusion and frustraon among consumers, who
wonder how ckets can appear on the resale market before ckets are even released to the
public.
In 2014, singer Eric Church expressed his frustraon with such ckeng: “They’re taking the
money, and they’re not even on sale. There’s no ckets on sale yet. They don’t really have them
– they’re promising the fact that they can get them. It’s a damn scam is all it is. It’s the maa.” In
the case of the 2016 Springsteen tour menoned above, NYAG asked StubHub, TicketNetwork,
and Vivid Seats to take down the speculave cket lisngs, and they all complied. This one-me
enforcement acon was eecve in that instance, but the problem is recurrent.
31. The methodology of this study appears in the Appendix.
Broker
Avg.
Cost
Avg.
Resale
Price
Markup
Highest
Markup
Amount Percent
Custom Bot A $145 $317 $172 118% 7,154%
Custom Bot B $104 $188 $84 81% 2,190%
Bot A $100 $137 $37 36% 637%
Bot B $105 $137 $32 30% 456%
Non-Bot Broker A $78 $101 $23 29% 1,537%
Non-Bot Broker B $111 $128 $17 15% 1,601%
27
g. The Market Structure Is Atypical.
Another nal point to keep in mind concerning this industry: the typical market structure is
skewed. For one, ckets are oen sold on the primary market for a face value that is below
market price. Although this may sound surprising, our invesgaon suggests it is common
and reects various factors. For one thing, maers of goodwill and reputaon in the sale of
ckets are important to certain performers. That is clearest, for example, for events where
the promoter has non-commercial goals – like Pope Francis, who distributed free ckets for his
public appearances – or at events like the New York City Center’s annual Fall for Dance Fesval,
which includes world-renowned performers but sells ckets for just $15, “in keeping with the
Fesval’s commitment to make dance accessible to everyone.”
32
Even more explicitly commercial acts somemes price their ckets below what they might charge
to make them accessible to younger fans or those of ordinary incomes. The band Fugazi, acve
over the 1990s and early 2000s, for example, long kept its cket prices at $5.
33
Pearl Jam, among
the most popular bands of the 1990s, set its cket prices at or below $20 to make it possible
for young fans to aend its concerts. As the band said in prepared tesmony before Congress,
“Although, given our popularity, we could undoubtedly connue to sell out our concerts with
cket prices at a premium level, we have made a conscious decision that we do not want to put
the price of our concerts out of the reach of many of our fans.”
34
Somemes a mixture of economic and non-economic moves is evident. A sports team, like the
Brooklyn Nets or New York Mets, might not want to be accused of “gouging” fans, and hoping
to build a loyal fan base, and so might price its ckets accordingly. Some sense of this came in
2009 when the New York Yankees experimented with much higher cket prices and were subject
to widespread cricism and unaering media coverage. The New York Post described the
Yankees’ new plan as “greed-driven-and-delivered” and the prices as “insanely and obscenely
high.”
35
Eventually, in the face of both cricism and poor sales, the Yankees lowered their prices
dramacally. Somemes even a prot-maximizing performer might set prices lower than market
value to guarantee a sellout and a full house for markeng purposes. Some of the promoters we
spoke with argued that a public sense of high demand and cket scarcity is necessary to create
strong demand for ckets. Hence, seng cket prices at a low level, so as to drive sales, may be
necessary to create the sense of a “sellout tour” that stokes demand to aend it.
Cheaper ckets could be very benecial to consumers, as long as they reap the benets. The
problem with this industry is that a middleman essenally takes the benets intended for the
consumer. In other words, the cket broker or reseller, able to buy up ckets before the public
gets a chance, prots from the lower priced cket – charging the consumer a much higher price
and pockeng the dierence. To further complicate the industry, the enes most able to stop
this pracce are either powerless or not economically incenvized to stop the pracce. Arsts
may want to avoid this from happening but have to rely on the venues to sell ckets. Venues
have an interest in selling out ckets and have lile incenve to put protecons in place. Ticket
32. Press Release, “New York City Center Announces 2015 Fall for Dance Festival” (July 29, 2015),
available at
https://www.nyci-
tycenter.org/content/misc/PressRelease-FFD15a.pdf.
33. John Pareles, “Review/Rock; Melodies Amid Rant, Thoughts Amid Rage,” N.Y. Times (Mar. 7, 1991),
available at
http://www.
nytimes.com/1991/03/07/arts/review-rock-melodies-amid-rant-thoughts-amid-rage.html.
34. Hearing of U.S. House Comm. on Gov’t Ops., Subcomm. on Info., Justice, Transp., & Ag., 103d Cong. (June 30, 1994).
35. Phil Mushnick, “Pricing fans out of Stadium no good for Yankees or MLB,” N.Y. Post (Apr. 27, 2014),
available at
http://nypost.
com/2014/04/27/pricing-fans-out-of-stadium-no-good-for-yankees-or-mlb.
28
vendors also have an interest in selling as many ckets as they can; they collect a fee with each
cket that is sold, a fee that is the same regardless of whether it is paid by you or a reseller.
B. High Fees for Unclear Purposes Raise Concerns
Next to sellouts, few issues seem to aggravate consumers as much as the addion of unexplained
“convenience” charges or “service” fees to the prices of ckets. These fees can be of considerable
cost to consumers as a percentage of a cket’s face value, or in absolute dollar terms. For
example, a cket to the Professional Bull Riding event at Madison Square Garden had $42 in fees
aached; a cket to
see Janet Jackson at
Jones Beach Theater
came with a $28 fee.
In 2010, the New
York legislature
amended the State’s
law governing cket
fees.
36
The statute,
as it stands, bans the
addion of
any
fee to a cket by a venue operator or its cket vendor except fees that are
associated with “special services” for which a “reasonable service charge” may be levied. The
statute states that special services include but are not limited to such services as “sales away from
the box oce, credit card sales
[37]
or delivery.” Thus, charges added to a cket’s face value violate
State law if they are either (1) mandatory, general fees, unconnected to the provision of “special
services,” or alternavely, when (2) such fees reach levels that are no longer “reasonable.”
A ban on the charging of mandatory fees unconnected to a bona de service is a common consumer
protecon measure. New York City, for example, expressly bars restaurants from adding general
surcharges to the prices on menus.
38
Relatedly, the U.S. Department of Transportaon considers
it an “unfair and decepve pracce” to adverse cket prices that do not include mandatory fees
and taxes.
39
The New York law on cket charges creates a similar rule by banning the charging
of fees unrelated to the provision of specialized services, and also regulang the fees that are
charged.
36. N.Y. Arts & Cult. A. L. § 25.29.1. The Senate Sponsor Memorandum summarized the provision as follows: “requires that service
charges in association with tickets sold be reasonable.”
37. Despite this provision, imposing a surcharge on credit card use is illegal under General Business Law § 518. (“No seller in any
sales transaction may impose a surcharge on a holder who elects to use a credit card in lieu of payment by cash, check, or similar
means”). See Expressions Hair Design v. Schneiderman, No. 13-4533 (2d Cir. 2015),
available at
http://law.justia.com/cases/fed-
eral/appellate-courts/ca2/13-4533/13-4533-2015-09-29.html.
38. New York City Rule § 5-59 provides: “A seller serving food or beverages for consumption on the premises may not add sur-
charges to listed prices. For example, a restaurant may not state at the bottom of its menu that a 10 percent charge or a $1.00
charge will be added to all menu prices.”
39. 14 CFR 399.84.
“I purchased a 30 dollar cket to see A View From
A Bridge. During the transacon I saw that a ten
dollar fee would be added for handling. Handling
what? I am using my own printer to print my own
cket!”
- Typical consumer complaint to NYAG about fees
1. Fees are Charged by Ticket Vendors and Venues.
Relying on publicly available informaon, NYAG conducted a broad study of the fees being
charged in New York State by 150 dierent venues and their cket vendors.
40
The examinaon
reveals substanal variaon in what fees are charged, but it also reveals some clear paerns.
First, it is worth nong that some outlets sell their ckets themselves; these venues are oen
smaller and non-prot. Examples include the Lancaster Opera House and the New York City
Ballet. These outlets or organizaons either do not charge any mandatory fees at all, or charge
a small service and/or handling fee for buying away from the cket oce that does not generally
vary with the price of the cket.
Most venues, however, sell their ckets pursuant to an exclusive contract with a cket vendor
like Ticketmaster or Tickets.com. This group includes the larger venues, such as Brooklyn’s
Barclays Center, Albany’s Times Union Center, and Bualo’s First Niagara Center. However,
smaller venues, like the Ulster Performing Arts Center in Kingston and the Stanley Center for the
Arts in Uca, also use cket vendors. Generally speaking, the venue/cket vendor combinaons
charge fees and use a variety of formulas to set them, such as adding a xed charge based on
the type of cket or charging some percentage of the total price of the ckets.
While it is ckeng vendors (mainly Ticketmaster) that bear the brunt of the complaints about
fees, some venues play a central role in seng such fees and share in the money that the cket
vendors collect. Our review of long-term contracts between Ticketmaster and large venues like
Barclays Center or Madison Square Garden reveals that the pares negoate the fee amounts —
including “convenience charges” or “service fees” (per cket) and “processing fees” (per order)
– that can be shared between the venue and cket vendor.
41
The venue may also ban the cket
vendor from levying other charges, such as “delivery fees” for PDFs of ckets.
Our examinaon of the fees charged in New York also allowed us to esmate the average fee
amounts charged by the larger venues in combinaon with three cket vendors for events
in this State: Ticketmaster, TicketWeb, and Tickets.com. On average, combining the fees
charged by these three vendors and their venue clients for 150 New York venues, we found an
average surcharge of 21% of the face value of a cket, which amounts to almost $8 in fees on
average. However, our invesgaon also revealed that in certain cases, cket fees charged were
surprisingly high in real dollar terms, even if they were not a large percentage of the face value
of the cket. The following chart shows examples of ckets for several events in which the fees
exceeded $25 per cket.
40. The methodology of this study appears in the Appendix.
41. Ticket vendors often enter into multi-year contracts with venue operators to sell tickets to all events at the operator’s facility.
The terms of these contracts generally set forth the convenience charges and other fees that Ticketmaster must collect, and the
portions of those fees and charges that it must deliver to the venue, as well as the portions that Ticketmaster can keep.
29
30
Figure 10. Examples of Large Fees for Select Events and Venues.
Source: Fees collected from Ticketmaster, Tickets.com & TicketWeb (2015)
Professional Bull
Riding: Built Ford
Tough Series
Radio City
Christmas
Spectacular
Brooklyn Nets vs.
Phoenix Suns
Janet Jackson:
Unbreakable
World Tour
Black Sabbath:
The End
$42
in fees or 21%
of face value
$41
in fees or 11%
of face value
$30
in fees or 7%
of face value
$28
in fees or 16%
of face value
$28
in fees or
16%
of face value
31
2. Event Ticket Fees are Higher than Most Online Vendors.
Because Ticketmaster, TicketWeb, and Tickets.com all conduct a major poron of their business
online, where costs are oen lower than for brick-and-mortar retailers, we examined other online
plaorms that, similar to cket vendors, interact with consumers on one side and sellers on the
other side, to assess whether charging consumers large services fees separate and apart from
the cket’s face value is nonetheless typical or perhaps necessary for ckeng. In this regard we
examined online vendors of ckets for airplane seats, such as Expedia and Priceline, and vendors
of ckets to lms, like Fandango and MovieTickets.com. We also examined online plaorms
that sell a broader mixture of goods, like Amazon and Etsy, to see if they charge consumer fees
separate and apart from the posted prices.
Our examinaon suggests that, among online plaorms, the vendors of event ckets appear to
charge fees to consumers that are higher than most other online vendors – in fact, most of the
online plaorms we examined charge no “general” fees to consumers for the sale of ckets or
goods and post prices that already reect the full cost to the consumer. That is true of Amazon
and Etsy, and it is also typically true even of vendors of airline ckets, like Expedia and Priceline.
42
The main excepons are the sites that sell movie ckets, because those vendors charge consumer
fees that are close in magnitude to the average fees charged in live event ckeng. Fandango,
for example, charges moviegoers a “transacon fee” between 75 cents and $2.50 per cket, and
a “convenience fee” of $1.50 per cket.
It is unclear what services are covered by the “convenience charges,” “service fees,” and
“processing fees” collected by online vendors of live event ckets, and why those services warrant
charging consumers fees that are higher than in most other online contexts. To the extent that
cket vendors and their venue operator clients collect these fees for anything other than the
provision of “special services,” they would be in violaon of New York law. In addion, any of
these fees that exceed a “reasonable” charge are impermissible under the law.
42. Rather than collecting money through fees to the consumers, these companies collect money from sellers who use their
platforms to sell to consumers. We observed no consumer fees being charged on any of these companies’ websites, and indeed
Expedia and Priceline state they rarely charge broker fees to consumers.
32
C. Restraints of Trade in Tickeng
Up to this point, the Report has focused on the sale and brokerage of ckets, which are subject to
industry-specic regulaon under Arcle 25 of New York’s Arts and Cultural Aairs Law. However,
under the Donnelly Act, the Aorney General is also tasked with enforcing the laws prohibing
unreasonable restraints of trade and the unlawful monopolizaon of markets. Pursuant to that
authority, NYAG has serious concerns about several ongoing pracces related to the sale and
resale of ckets in New York. In parcular, NYAG is concerned with the seng of price oors on
cket resale, the pracces that impede consumer access to alternave cket resale plaorms,
and, in parcular, the combined eect of such conduct on consumers. NYAG is involved in an
ongoing mul-state invesgaon of these issues.
1. Seng of Ticket Resale Price Floors.
Some cket issuers – parcularly sports teams, including NFL teams and the New York Yankees
– have put in place “price oors.” Price oors are rules designed to prevent ckets from being
sold at a price below some level, usually the face value of the cket or something close to it.
For example, many NFL teams encourage or even require cket holders to use Ticketmaster’s
“NFL Ticket Exchange” plaorm – which is frequently billed as the ocial resale site and the
only “safe” place to buy secondary NFL ckets. However, on NFL Ticket Exchange the seller is
then prohibited from seng a price below a certain level – generally the face value of the cket.
Consequently, if a season cket holder wants to sell his or her ckets for a lower price than he
or she paid, he or she may be unable to do so, or may need to use a complex procedure to do so
on another plaorm.
NYAG’s concern with price oors is twofold. First, buyers of ckets on Ticket Exchange or other
sites with price oors are frequently not informed that the ckets they are buying are subject
to a oor. It is therefore easy for buyers to be fooled into believing what they are paying is the
market price for a cket, when in fact the buyer is paying a price arcially inated by a price
oor. The more aggressively sports leagues and individual teams push cket buyers and sellers
to use their “ocial” secondary markets, the more serious this problem becomes.
More fundamentally, even when buyers are informed of price oors, the oors deprive the
public of a chief benet of the market-driven approach taken by the 2007 law: lower prices. In
parcular, price oors may make it impossible to obtain ckets on the team-promoted Ticket
Exchange plaorm for below face value when demand decreases. As described above, when
contemplang the legalizaon of cket resale, the sponsors of the 2007 legislature repeatedly
expressed the hope that legalizing prot resale might lower prices for consumers. A clear source
of such savings is lower prices when demand falls. For example, near the end of an unsuccessful
baseball season, the ckets to watch a team not desned for the playos may go down sharply,
allowing fans who otherwise might not be able to aord to see a match to buy ckets for far less
money.
Overall, NYAG believes there is lile to say in favor of price oors: They tend to expose the public
to the full costs of the new cket economy, while depriving the public of the benets.
33
2. Pracces That Impede Consumer Access to Alternave or “Unocial”
Ticket Resale Plaorms.
The problems that come with price oors are exacerbated by eorts to push consumers to the
resale plaorms that maintain them and pracces that impede consumer use of plaorms that
do not. NYAG is therefore greatly concerned with other forms of restraints imposed on the resale
of ckets, parcularly when those restraints impede or complicate consumer access to resale
cket plaorms that do not enforce price oors. Examples of such pracces include delayed
delivery of PDF versions of resold ckets, and policies that place season cket holders at risk of
cancellaon of their cket subscripons when they sell on unocial resale plaorms.
The consumer harm caused by price oors is directly related to the success of the eorts to
pressure consumers to use only the primary seller’s (usually Ticketmaster’s) plaorm. That is
because plaorms that use price oors are at a natural compeve disadvantage compared to
those that do not, and so if consumers engage in comparison shopping, they will gravitate to the
plaorms with a more open market. However, to the extent that the combinaon of pracces
such as PDF-delays and cancellaon threats pressure consumers into using the plaorms that
incorporate a price oor, consumers will be harmed. This is parcularly true given the inadequate
disclosure of the existence of these price oors. Without knowing that beer prices could be
available elsewhere, it is harder for consumers to benet from the compeve market.
34
RECOMMENDATIONS
The State regards ckeng and cket resale as “a maer aected with the public interest.”
43
Unfortunately, if one of the purposes of the 2007 law – which repealed the ban on “scalping”
– was to reduce cket prices, or make ckets more available to “ordinary” fans, it has not been
successful. While there have been some posive developments, the basic reality described in the
1999 Report remains the same. If nine decades of experience have taught anything, it is that the
incredible demand for desirable ckets can be exploited even in the face of determined eorts
to get ckets in the hands of the public. The long history of cket “scalping,” the challenges
inherent in enforcement, and the incenves and prots available may make some think it is
impossible to x ckeng. Nonetheless, the situaon is not hopeless.
There are several concrete steps industry parcipants can take to make the system fairer and
more transparent. In light of the ndings in this Report, we believe that the legislature should
hold hearings on the subject of ckeng in New York to challenge key members of this industry
to put forth how they might help more ckets get into the hands of “ordinary” fans. However,
if soluons are not implemented soon, the best and cheapest ckets will connue to go to the
resellers and consumers will connue to ask why they cannot get ckets.
A. Ticket Resale Plaorms Must Ensure Brokers
Comply With the Law.
Ticket resale plaorms such as StubHub, TicketsNow, TicketNetwork and Vivid Seats are the
major vehicles through which ckets are sold on the secondary market. They are thus in the best
posion to eect change in the industry. There are several steps these companies should take to
contribute to the success of this market.
First, each cket resale plaorm should ensure that professional resellers comply with New York
State’s licensing provisions by requiring that the resellers provide their cket reseller license
number as a condion of using the plaorm. In most cases, by examining the volume of resale
business a reseller conducts, resale plaorms can easily disnguish professional resellers – who
engage in the business of cket resale and are required to obtain a license – from fans that are
simply reselling ckets purchased for their own personal use – who are not required to have a
license.
Second, each cket resale plaorm should enable professional resellers to disclose the face
value of the ckets they resell, which is required of resellers by New York State law.
44
. It is
currently impossible for well-meaning resellers to disclose the face value of ckets on most resale
plaorms. Secondary market plaorms have the capability, however, of adding funconality to
their websites and apps to facilitate brokers’ compliance with the law, for example, by enabling
resellers to provide face value informaon when posng a cket for sale. They should do so.
43. N.Y. Arts & Cult. A. L.§ 25.01.
44. Id. § 25.23.
35
B. Industry Players Must Increase Transparency Regarding Ticket
Allocaons and Limits.
The precise manner in which ckets are distributed – to industry insiders through holds, to non-
public groups through pre-sales, and to the general public through public on-sales – is rarely,
if ever, disclosed to the public. This informaon vacuum allows various players in the industry
to avoid their share of responsibility for the current problems the industry faces. It also breeds
mistrust from consumers, who feel like the system is xed against them.
To address these issues, industry players must publicly disclose the allocaon of ckets through
holds, pre-sale events, and public on-sales. This requires that many players, including promoters
and cket vendors, work together to eecvely distribute informaon to the public.
In addion, wherever cket vendors claim that cket limits are enforced, they should enforce
those limits as a maer of course on a per-person basis. If such limits are not actually being
enforced on a per-person basis, cket vendors must disclose that informaon.
C. Ticket Vendors Must Address the Bot Epidemic.
Although NYAG has taken steps to stop many of the largest operaons from using Bots to purchase
ckets to events in New York, we recognize that other brokers may take their place. A longer-
term soluon must include improvements in Bot detecon and prevenon methods. While
the industry works on long-term technological soluons, steps can be taken to reduce Bot use
in the near term. Towards that end, NYAG has analyzed the informaon and material gathered
through its invesgaon. Based on this analysis, we have compiled several recommendaons
for enhancing Bot detecon systems.
NYAG has contacted two of the largest ckeng companies, Ticketmaster and AXS, to discuss
our concerns with Bots and cket limits, and suggested concrete reforms to their operaons
that, we believe, will substanally reduce the acvies of illegal brokers and make the sale of
ckets fairer. Some of the suggesons included preempvely enforcing cket limits, analyzing
purchase data to idenfy ongoing Bot operaons, and invesgang resellers regularly oering
large numbers of ckets to popular shows, among others.
D. The Legislature Should Act.
To curb abuses in the industry and create a more equitable process for fans to obtain ckets, the
legislature should take the following acons:
i. Mandate the industry reforms outlined above.
In many cases, industry players do not have an incenve to reform. To ensure that the steps
described above are implemented in a meaningful and lasng way, the legislature should
mandate them.
36
ii. End the ban on non-transferrable paperless ckets.
“Paperless ckets” are non-transferrable event ckets that are designed to avoid resale by
brokers. Their dening feature is their non-transferrable nature, not the fact that they are
electronic, because many events oer ckets as PDFs or in other electronic form that the buyer
can sell or give to another person to use to aend the event. Non-transferrable paperless
ckets bear some resemblance to airline ckets, requiring the presentaon of idencaon
and the credit card used to buy the cket at the entrance to the venue. As such, it is harder
for paperless ckets to be transferred or resold, given the need to present the purchasing
credit card. Advocates of non-transferrable paperless ckets, including Ticketmaster and
many prominent performers such as Bruce Springsteen and Miley Cyrus, have argued that
they are an important and eecve “an-scalping” measure because increasing the diculty
of transferring ckets makes it harder for brokers to resell ckets for prot.
In 2010, New York amended its ckeng law to bar the issuance of non-transferrable
paperless ckets
unless
consumers are provided with an opt-out, that is, the opon of
another easily transferable ckeng format at no extra cost. The law is a
de facto
ban,
given that the opon allows brokers to request resalable ckets, and therefore erodes the
purported funcon of the non-transferrable paperless cket. As such, the change was widely
reported as a ban, and appears to be understood that way, at least by some performers. For
example, in September of 2014, popular musician Cat Stevens (now known as Yusuf Islam)
canceled a show in New York City on account of the ban. “I have been a longme supporter
of paperless ckets to my shows worldwide and avoiding scalpers,” he said. “Unfortunately
NY has a state law that requires all ckets sold for shows in NYC to be paper, enabling them
to be bought and sold at inated prices.”
NYAG believes that New York’s ban on non-transferrable paperless ckets – the only one in
the naon – should be reconsidered and repealed. It is true that paperless ckets have met
with some resistance; they can somemes be inconvenient to consumers and venues (for
example, if the credit card is forgoen, or if someone wants to give a cket as a gi). That
may be why, naonwide, the use of such ckets has been limited to those acts that regularly
can expect to sell out. At the same me, paperless ckets appear to be one of the few
measures to have any clear eect in reducing the excessive prices charged on the secondary
markets and increasing the odds of fans buying ckets at face value. At least one major
arst’s representave and one ckeng vendor reported seeing the use of non-transferrable
paperless ckets for the most desirable seats greatly reduce resale of ckets for those seats.
Allowing these types of ckets would therefore make it more dicult for brokers to connue
hoarding ckets and demanding exorbitant markups from fans. Moreover, such a change
would not require arsts, promoters or venues to use paperless ckets, but would merely
give them the opon to use them.
It is true that paperless ckeng is not a completely foolproof countermeasure. Brokers
wishing to resell such ckets can do so, but must then hire people to go to the concert and
physically walk fans through the gate at a show (assuming the ID provision is unenforced),
or alternavely, buy ckets with a prepaid “gi” credit card that is physically mailed to the
consumer. Nonetheless, our conversaons with promoters of performers who use paperless
ckets and others lead us to believe that paperless ckets can eecvely limit the ability of
brokers to resell at great mulples on secondary markets. That may explain why, despite sll
represenng a small percentage of total cket sales, a number of high-prole bands now
use non-transferrable paperless ckeng outside of New York, including Bruce Springsteen,
37
Radiohead, Iron Maiden, Cat Stevens, Paramore, Widespread Panic and Metallica.
NYAG supports repeal of the
de facto
paperless cket ban, but a repeal raises several
concerns. Among the most important concerns raised against allowing non-transferrable
paperless ckets when the legislature passed the ban in 2010 was that they might serve a
dual purpose; they might not merely reduce broker markups, but also become a means by
which Ticketmaster might leverage its market power over primary ckeng for given events
into the dominaon of secondary sales as well. This concern follows because, in some
implementaons of paperless ckeng, ckets would not be completely non-transferrable.
Instead, ckets would be non-transferrable unless the cket was resold through Ticketmaster’s
own Ticket Exchange resale plaorm. When Ticketmaster is the “exclusive” resale plaorm,
the potenal for extending its market power is obvious.
Nonetheless, the potenal for abuse does not jusfy a complete ban on paperless ckets.
When repealing the law, the legislature should consider safeguards that would permit non-
transferrable paperless ckeng while migang compeve concerns.
iii. Impose criminal penales for Bot use.
There is consensus in the cket industry that Ticket Bots have no place in a fair and equitable
cket market. Current law prohibits the usage of Bots and imposes civil sancons for
violaons. However, the prospect of criminal prosecuon may well have a greater deterrent
eect. Passage of the BOTS Act by Congress and the criminal penales that it would impose
for the use or sale of bots could also act as a deterrent.
iv. Cap permissible resale markups.
Unl 2007, ckeng laws capped the price of ckets sold on the secondary market. At rst,
for certain events, it was capped at two dollars above face value. Eventually, the two-dollar
limit became a 20% or 45% price cap (depending on the size of the venue). In 2007, the caps
were lied. Unfortunately, given the complexies of the market and the skewed incenves
that exist, under the current legal regime brokers will connue to use whatever means they
can, legal or illegal, to obtain ckets. New York should therefore reinstute a reasonable
limit on resale markups. Reinstang caps on markups would sll allow brokers a role in the
market but would also ensure that any price markups be reasonable.
38
APPENDIX – METHODOLOGY FOR NYAG ANALYSES
Holds & Pre-Sales Analysis
NYAG analyzed cket allocaon data for the highest grossing concerts in New York produced
by AEG, Live Naon, and Ticketmaster. NYAG’s analysis aggregated the data into four main
categories: holds, pre-sales, general on-sales, and other on-sales.
AEG
AEG produced cket allocaon data for the highest grossing concerts between January 1, 2012
and April 30, 2015 for which AEG served as the promoter at the following venues: Barclays
Center, Beacon Theatre, Madison Square Garden, Nassau Coliseum, Nikon at Jones Beach Theater,
Saratoga Performing Arts Center, The Theater at Madison Square Garden, Yankee Stadium, and
Icahn Stadium.
Data concerning the following concerts were excluded from the analysis due to observed data
inconsistencies:
• American Idol 2012 at Nassau Coliseum on August 22, 2012
• Carrie Underwood Fall 2012 at Nassau Coliseum on November 30, 2012
• Dane Cook at Beacon Theatre on September 14, 2013
• Enrique Iglesias at Madison Square Garden on September 25, 2014
• Enrique Iglesias Nassau Coliseum on September 14, 2014
• Fresh Beat Band (Both Shows) at The Theater at Madison Square Garden on January 17,
2015
• Fresh Beat Band at The Theater at Madison Square Garden on November 29, 2013
• George Lopez at Beacon Theatre on April 25, 2014
• Jennifer Neles at Beacon Theatre on March 5, 2014
• Jusn Bieber at Barclays Center on August 2, 2013
• Kanye West at Madison Square Garden on November 23, 2013
• Kanye West at Madison Square Garden on November 24, 2013
• Mindless Behavior (Both Shows) at Beacon Theatre on July 13, 2013
• Nashville at Beacon Theatre on April 29, 2015
• Nashville at Beacon Theatre on April 30, 2015
• Nick Cave & The Bad Seeds at Beacon Theatre on March 28, 2012
• Nick Cave & The Bad Seeds at Beacon Theatre on March 29, 2012
• Nick Cave & The Bad Seeds at Beacon Theatre on March 30, 2012
• Pentatonix at The Theater at Madison Square Garden on March 18, 2015
• R. Kelly at The Theater at Madison Square Garden on November 21, 2012
• Sytycd at Beacon Theatre on October 30, 2014
• The Who Performing Quadrophenia at Madison Square Garden on November 14, 2012
• The Who Performing Quadrophenia at Barclays Center on December 5, 2012
• Trey Songz at The Theater at Madison Square Garden on December 5, 2012
39
For 42 of the remaining concerts, the cket allocaon data for each concert were aggregated in
the following way:
• Total Tickets: The total number of ckets that were made available through a hold, pre-
sale, or general on-sale event. This gure was calculated by subtracng the Producon
Holds gure from the Starng Capacity gure. AEG denes Starng Capacity as: “…the total
number of ckets to be oered for sale as of the day before the rst pre-sale. Addional
ckets may be subsequently released for sale.” AEG denes Producon Holds as: “… the
number of ckets held back from sale due to producon elements that create obstructed
views or eliminate physical seang. Tickets are oen periodically released before the show
typically for general public purchase from this total.”
• Total Holds: The total number of ckets placed on hold for an event. Calculated by
aggregang the following AEG categories: “arst holds,” “agent,” “venue,” “suite relos”
(“seats provided to venue’s suite holders due to obstrucon of suites”) “AEG,” “sponsor,”
“label,” and “markeng.” Tickets in the Producon Holds group were not included.
• Total Pre-Sale: The total number of ckets made available through pre-sales events.
Calculated by aggregang the following AEG categories: “Chase,” “Amex,” “Ci,” “Fan Club,”
“Fan Club / Gilt,” and “Venue Club.”
• Total Other On-Sale: The total number of ckets made available through the following
cket groups: “ADA,” “VIP Packages / Planum,” and “VIP Packages.”
• Total General On-Sale: The total number of ckets made available to the general public.
Calculated by subtracng Total Holds, Total Pre-Sale, and Total Other On-Sale from Total
Tickets.
Due to dierences in the producon of data, for two Katy Perry concerts at Barclays Center on
July 24, 2014 and July 25, 2014 the cket allocaon data for each concert were aggregated in
the following way:
• Total Tickets: The total number of ckets that were made available through a hold, pre-
sale, or general on-sale event. Used the sum of Total Holds, Total Pre-Sale, Total Other On-
Sale, and Total General On-Sale, as dened below.
• Total Holds: The total number of ckets placed on hold for an event. Calculated by
aggregang the following AEG categories: “Arst and Supporng Acts,” “AEG,” “CAA ‘MGMT,’”
“Label,” “Charity,” “Markeng Comps,” “Reviewer Comps,” and “Sponsor.”
• Total Pre-Sale: The total number of ckets made available through pre-sales events.
Calculated by aggregang the following AEG categories: “Cibank Pre-Sale,” “Facebook,”
“AMX BluHold,” “Venue Club + Nets Basketball,” “VIP Pack 1-5,” “Planum,” and “Flex Hold.”
AEG described Flex Hold as follows: “these are seats not yet priced. Once price is determined
they are released for sale during the pre-sale or general on sale.”
• Total Other On-Sale: The total number of ckets made available through the AEG category
“220° Sell” and “Flex Hold 2”. AEG describes 220° Sell as follows: “these are seats past the
180 degree full view sell line. Typically sold as ‘side view,’ they are opened once the full view
inventory is depleted.”
40
• Total General On-Sale: The total number of ckets made available to the general public.
Uses the AEG category: “Esmate Of Total Opens Available For General On Sale,” which is
described as follows: “This Is Inventory Held Back From The Pre-Sale To Be Sold Only at the
general on sale.”
Live Naon/Ticketmaster
Live Naon and Ticketmaster produced cket allocaon data for the highest grossing concerts
between January 1, 2012 and December 31, 2013 for which Live Naon served as the promoter
at the following venues: Barclays Center, Beacon Theatre, Madison Square Garden, Nassau
Coliseum, Nikon at Jones Beach Theater, Saratoga Performing Arts Center, the Theater at Madison
Square Garden, Yankee Stadium, and Icahn Stadium. NYAG analyzed the data that was produced
as described below.
Live Naon also produced cket allocaon data for the highest grossing concerts between
December 10, 2013 and August 31, 2015 for which Live Naon served as the promoter for the
following venues: Barclays Center, Beacon Theatre, Madison Square Garden, Nassau Coliseum,
Nikon at Jones Beach Theater, Saratoga Performing Arts Center, the Theater at Madison Square
Garden, Yankee Stadium, and Icahn Stadium. The data produced by Live Naon, however, did
not contain sucient informaon to use in the NYAG’s analysis.
Data concerning the following concerts were excluded from the analysis due to observed data
inconsistencies:
• Eagles at Madison Square Garden on November 8, 2013
• Eagles at Madison Square Garden on November 9, 2013
• Eagles at Madison Square Garden on November 11, 2013
• Macklemore at Madison Square Garden Theatre on November 13, 2013
• Macklemore at Madison Square Garden Theatre on November 14, 2013
• Macklemore at Madison Square Garden Theatre on November 15, 2013
For the remaining 32 concerts, the cket allocaon data for each concert were aggreggated in
the following way:s
• Total Tickets: The total number of ckets that were made available through a hold, pre-sale
or general on-sale event. Calculated by subtracng all cket groups idened as a producon
hold, such as “Rearview,” “Producon Kills,” and “Producon Holds,” from the “Total Tickets
Available” gure.
• Total Holds: The total number of ckets placed on hold for an event. Calculated by aggregang
the following groups and others: “Arst(s),” “Management,” “Support Act,” “Venue,” “Tour
Sponsor,” “Label,” “Live Naon,” “Sponsor,” “Markeng,” “Promoon,” “Tour Hold,” “Arst Agent,”
and “Live Naon Touring.” Ticket groups idened as a producon hold, such as “Rearview,”
“Producon Kills,” and “Producon Holds,” were not included.
• Total Pre-Sale: The total number of ckets made available through pre-sales events. Calculated
by aggregang the following groups and others: “Fan Club OnSale,” “Fan Club Presale,” “LN/
Facebook,” “Venue Presale,” “Arst Presale,” “VIP1-2 Presale,” “LN & Venue Presale,” “Live
Naon Presale,” “Season Tickets,” “Chase Presale,” “Mastercard OnSale,” “Ci Preferred,” “AMEX
PreSale,” “AMEX Postsale,” and “CiCard Postsale.”
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• Total Other On-Sale: The total number of ckets made available through the following cket
groups and others: “VIP Packages,” “Planum,” and “ADA Seang.”
• General On-Sale: The total number of ckets made available to the general public. Calculated
by aggregang the following groups: “Public Onsale,” “Public Protect Opens,” “SRO-Opens Sell
Last,” “Dress,” and “Café Sell Last.”
Analysis of Brokers Using American Express Data
American Express produced informaon on all transacons through a Ticketmaster merchant
account for New York State and surrounding areas for the period of April 1, 2013 to March 1,
2015. NYAG aggregated the individual transacons for each primary account holder to calculate,
for each account holder, the total number of transacons, the total cost of these transacons,
and the total number of unique cards used. NYAG then idened those account holders that
had completed purchases totaling more than $3 million.
Broker Markup Analysis
NYAG analyzed transaconal sales data for events in New York produced by six cket brokers to
esmate the margins they typically obtained in connecon with their resale of ckets. The data
cover sales by these six brokers made from 2010 to 2014 and include over 90,000 transacons.
All reported transacons for which a sales price and cost per cket that exceeded one dollar
were idened in the data were included in the analysis. The analysis esmated a markup for
each transacon, which is dened as the rao between the net revenue earned by the sale of
an individual cket and its cost. The average broker markups were then calculated across all
transacons and weighted by each transacon’s face value.
Fees Analysis
NYAG conducted a study of cket fees in an eort to esmate the typical fee amount charged
by cket vendors for entertainment ckets. The study reected fees typically charged by these
cket vendors as of October/November 2015. The study did not include every cket sold by cket
vendors in the State, but rather relied on informaon displayed on Ticketmaster, Tickets.com,
and TicketWeb’s websites in connecon with the sale of ckets for events in popular venues. In
parcular, the study collected fee informaon and cket prices for 150 New York venues listed by
the three cket vendors on their websites. For each venue, fee informaon was collected for up
to three randomly chosen events and, for each event, informaon was collected for every cket
category (e.g., orchestra, mezzanine). In total, a sample consisng of 859 dierent ckets was
created for venues explicitly listed or promoted by cket sellers. Fee informaon included any
costs associated with an online sale and delivery of a cket separate from its face value. These
costs may include service fees, credit card fees, facility fees, and/or any other fees associated
with the online sale and delivery of an event cket.
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